Cryptocurrencies experienced a notable decline as investors reacted to risk aversion in the market, following US President Donald Trump’s announcement of new tariffs on eight European nations. Bitcoin, the leading cryptocurrency, fell as much as 3.6%, dipping below $92,000 on Monday morning, while numerous other digital assets suffered even greater losses. Ether, the second-largest cryptocurrency, dropped 4.9%, and Solana faced a significant decline of 8.6%. This selloff resulted in an approximate loss of $100 billion in total market capitalization for cryptocurrencies, as reported by CoinGecko.
Trump’s recent tariff proposal includes a 10% levy on goods imported from a select group of European countries starting February 1, which is set to escalate to 25% by June unless an agreement regarding the “purchase of Greenland” is reached. His comments have led to a downward trend in US equity-index futures at the beginning of trading on Monday, while traditional safe-haven assets like gold and silver surged to record highs.
The European response has been largely negative, with leaders now considering suspending the approval of a trade agreement struck the previous year.
The digital asset market had seen a promising start to the year, particularly following a lackluster performance at the end of 2025. Bitcoin had reached nearly $98,000 on January 14, driven by substantial inflows into US-listed exchange-traded funds linked to the cryptocurrency. Analysts noted that the previous upward momentum seemed to be a recovery from oversold conditions, marked by tax-loss selling and a general capitulation trend seen towards the end of the year.
However, the recent announcement regarding tariffs has disrupted this burgeoning recovery, with gold hitting unprecedented highs indicating that the selloff is largely driven by a broader risk-off sentiment rather than issues specific to cryptocurrencies.
In the last 24 hours, approximately $790 million in bullish positions on cryptocurrencies were liquidated, as per data from CoinGlass. Market analysts suggest that if current support levels fail, Bitcoin could potentially drop to $90,000. Meanwhile, some bullish traders are highlighting institutional demand as a potential support mechanism amidst the falling prices.
As of 6:27 a.m. in London, Bitcoin was trading at $92,531, amid shifting trader sentiment and growing uncertainty in the financial landscape.
